The ongoing negotiations over TikTok’s U.S. operations have been delayed after China signaled its opposition to the proposed sale. President Donald Trump has extended the deadline for ByteDance’s divestment due to the tariff hikes.
What Happened: On Friday, President Trump announced an extension of the deadline for ByteDance to sell its U.S. operations of the popular video-sharing app TikTok.
The new deadline, extended by 75 days, was initially set to expire on Saturday under a 2024 law that mandates ByteDance sell TikTok’s U.S. assets or face a potential ban.
The delay comes after China expressed strong disapproval of the deal, a stance that has now complicated the negotiations, reported Reuters, citing two people familiar with the matter.
The deal was reportedly near completion by Wednesday, with the structure set to spin off TikTok’s U.S. operations into a new company. This new company would have been based in the U.S. and majority-owned by U.S. investors, with ByteDance maintaining a minority stake of less than 20%.
However, as tensions escalated over the U.S.-China trade relations and the recently introduced tariffs, China’s opposition halted the deal.
The Chinese government, via the Chinese Embassy in Washington, said, “China has stated its position on TikTok on multiple occasions. China has always respected and protected the legitimate rights and interests of enterprises and opposed practices that violate the basic principles of the market economy.”
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This response followed President Trump’s decision to implement a new round of tariffs, increasing duties on Chinese goods to 54%, which directly affected the negotiations.
Trump acknowledged the difficulty in finalizing the deal given the new tariffs but expressed hope that discussions could continue in good faith with China.
He also stated, “We do not want TikTok to ‘go dark,’” underscoring his intention to find a solution that prevents the app from being banned in the U.S.
Why It Matters: The delay in TikTok’s U.S. divestment highlights the ongoing friction between the U.S. and China over tech companies, national security concerns, and trade relations.
TikTok has faced scrutiny from U.S. lawmakers over concerns that the Chinese government could use the app to gather sensitive data on American citizens or influence them through its algorithm.
The 2024 law was passed with bipartisan support to address these concerns, and lawmakers have insisted that the divestment proceed swiftly to protect U.S. users.
With companies such as Oracle Corp (NYSE:ORCL), Blackstone Inc. (NYSE:BX), Amazon.com, Inc. (NASDAQ:AMZN), and Andreessen Horowitz already involved in discussions to buy TikTok’s U.S. operations, the potential for a resolution remains uncertain as China’s approval becomes a critical obstacle.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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